Center for the Edge
Perspective Aug 29, 2023 6 min read Ecosystems Scalable learning

Refreshed perspective on Performance Ecosystems

Authors: John Hagel III, Daniel Sunde-Hansen

It has never been more relevant to understand the dynamics of ecosystems. Our original research report on Performance Ecosystems was published one decade ago, so it seemed like a good time to step back and reflect on what we said then: what we got right, what we should have explored further, and what we got wrong.

What did we get right?

After a decade, we have not been able to find anything in the original report that was wrong. The key messages were that business ecosystems can take many different forms, and that there is an untapped opportunity to deploy and manage dynamic ecosystems where the focus is on helping all participants learn faster and accelerate performance improvement.

A decade later, the taxonomy of ecosystems remains valid and can be helpful for executives assessing how to leverage ecosystems to support their initiatives.

Recent ecosystem initiatives initiated by the Center for the Edge

Dynamic ecosystems: an untapped opportunity, increasingly an imperative

Dynamic ecosystems remain a significant untapped opportunity. If anything, their potential has increased as digital technology enhances our ability to measure performance in real-time, understand context, connect more people at lower cost, and learn faster about what actions drive performance improvement.

They are also increasingly becoming an imperative. Digital technology continues to produce mounting performance pressure, making it essential to find ways to accelerate learning and performance improvement.

Leveraged growth as a third growth strategy

In growth strategies, leaders often focus on two options: make or buy. This ignores a third option that is becoming increasingly feasible and necessary: leveraged growth.

Leveraged growth occurs when we mobilize a growing number of third parties to deliver more value to stakeholders and capture some of that value. It requires deepening our capability to participate in larger ecosystems and becomes even more powerful when we harness dynamic ecosystems.

What should we have explored further?

We should have paid more attention to the challenges leaders face as they seek to harness ecosystems, especially dynamic ecosystems. Leaders will need to master new management techniques in ecosystems, and also inside their own organizations.

This implies a profound transformation: a shift from an institutional model of scalable efficiency to an institutional model of scalable learning.

Fear is a barrier, inspiring strategy helps people move beyond it

In a world of mounting performance pressure, fear can narrow time horizons, increase risk aversion, and reduce trust. The result is overwhelm: change feels too risky, so leaders default to what worked in the past. This is a key reason dynamic ecosystems remain untapped.

The "zoom out, zoom in" approach helps people see an inspiring 10 to 20 year opportunity and also make tangible progress in the next 6 to 12 months.

Platforms and learning platforms

The original report did not focus enough on platforms: governance structures and incentives that bring the right participants together and focus interactions with impact. Platforms are less about technology and more about enabling the interactions required for ecosystem success.

A key under-invested platform type is learning platforms. Not platforms for distributing existing knowledge, but platforms for creating new knowledge together by addressing previously unseen problems and opportunities.

Bottom line

Dynamic ecosystems remain a significant untapped opportunity, and increasingly an imperative. To address this, leaders must embrace the transformation toward scalable learning, overcome fear, and cultivate emotions that excite participants to come together and achieve more than they could alone.